Respuesta :
Private corporations have less transparency obligations than publicly traded companies, hence their audit standards are less strict.
For instance, the Securities and Exchange Commission (SEC), one of the organizations that sets rules for public corporations, does not examine small privately held enterprises. The disparity between the necessity for greater disclosure from smaller enterprises and the extra costs that smaller business owners would incur under tougher reporting regulations is being addressed by accounting regulators.
Although for various reasons, generally accepted accounting rules (GAAP) apply to both private and public firms. The SEC mandates that publicly listed corporations deliver audited financial statements that adhere to GAAP. In order to satisfy lenders, specific groups of shareholders, or insurance companies, private corporations may be required to follow GAAP. Nevertheless, a lot of private businesses don't publish audited financial accounts. Since reducing taxes is their primary goal, they frequently simply create tax returns and unaudited statements.
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